Monthly Archives: November 2020
Life insurance 101: Do you need it and how much does it cost?
No one likes to think about needing life insurance. But the only way to understand is to, well, understand it. Before you decide that you do or don’t need life insurance, you need to understand what it is, what it costs, and what it could mean for you and your family.
What is life insurance?
Life insurance is a service provided by insurance companies – in exchange for monthly payments, they provide a lump sum payment, known as a death benefit, to the beneficiaries of the person paying when that person passes away. For most people, the beneficiaries would be their family members.
How do I get it?
If you (or your spouse) receive insurance benefits through your workplace, it is likely that there is a life insurance plan available as well. Reach out to your Human Resources department to find out if life insurance is an option for you through your company, and what you need to do to learn more about it. There are also insurance companies that offer life insurance to anyone who qualifies – you do not have to go through the insurance provided by your work.
But wouldn’t using my current insurance provider make it easier?
There are pros and cons to acquiring life insurance through your work. On one hand, it is much more convenient to do a work-sponsored plan, and you will likely get a better rate. On the other hand, that means your life insurance is tied to your job, so if you lose your job for any reason, you would lose those benefits, and potentially have a gap in coverage where you would no longer have life insurance until you found your next job.
What does it cover?
Life insurance, much like your typical medical insurance, can be tailored (to a degree) to fit your needs. For instance, if you have children, you will want to ensure that the payment amount of the death benefit would be sufficient to cover their expenses until other resources are available.
Or if you are about to get married, look for policies that cover things like student loan debts, home expenses, and other daily needs. If you have a family member with special needs who requires medical equipment or therapy, you will want to consider those costs as well.
Can anyone get it?
There are eligibility considerations when it comes to life insurance. The majority of people will qualify for life insurance without an issue. But, just like other types of insurance, there is an underwriting process that takes place to determine your eligibility.
The underwriter will look at things like your health, medical history, family history, lifestyle habits (i.e., smoking, any dangerous activities you undertake regularly, etc.), and you may also need a physical exam before the insurance company makes a final decision. You may learn that you have to pay more than you expected because you are a higher risk to insure, but there is little chance you will not be eligible at all.
Are there different kinds?
There are three different types of life insurance policies that you may have to choose between: term, universal, and whole. The main differences are the longevity of the policy, the flexibility of the policy, and the cost. For instance, term life insurance is designed to cover a specific period in your life, such as the next 20 or 30 years. But it also costs less than a whole life insurance policy, which is more expensive but covers your entire life instead of just the pre-determined time period. Work with your insurance provider to understand all of your options.
Do I really need it?
Again, this is not a pleasant subject for anyone to consider. But it is a necessary one. Only you and your family can determine together if life insurance is the right step; however, we would encourage you to give it some serious thought before making a decision.
It is a financial obligation, and if you have other ways of providing for your family in the unlikely event of your death, you may decide life insurance is not for you. Or if you are worried about how your family would function without your income, you might realize that having this extra insurance policy is worth the extra cost in the long run. It all depends on what you need and what you’ve already planned for your future.
Who can help me understand this better?
When you Google “life insurance,” you will be greeted with a page full of ads, but very little information. Look for resources like this Fidelity website, which breaks down some of the basic questions, or this website that takes you through the underwriting process.
Your best bet is to call the insurance company directly and ask, or, if you are comfortable doing so, talk to a coworker who uses your insurance to see if they are satisfied with the service they receive. Human Resources will also be able to give you additional help and places for research.
5 best side hustles to earn extra money
This year more than most, you may have found yourself getting creative to stretch your budget a little farther than usual. Some extra income would be ideal, but you are not able to take on a job right now in addition to the other responsibilities in your life. But if you could find a source of income that worked with your schedule and skills while also allowing you some breathing room for your budget, wouldn’t you jump at the opportunity? Read on for five great ways to bring in a little extra money each month.
1. Tutoring
Were you a teacher in a past life? Or, if not, do you feel you have always had a talent for understanding algebra or chemistry? Put those skills to work for you and find some local students who need tutoring. Tutors are needed now more than ever, as many students find they need extra help to navigate learning during this unusual school year.
You can even expand beyond your local community and offer tutoring over a video service like Zoom, or sign up with a program like VIPKid to have a more steady schedule. If you have the time and space, you could also set up a weekly tutoring session for multiple kids in your home or at a local park.
2. Writing
If you have a gift for writing, consider looking into opportunities to do some freelance work. Many websites or magazines are looking for writers who can assist them in creating new content and covering relevant topics for the audience they want to reach.
Websites like Upwork will even help you sort through various opportunities and find which jobs may be a good fit for you. Make a note that Upwork and other similar websites often charge a fee for their services; however, if you can swing the extra funds, the eventual payoff will be much greater.
3. Shopping
As much as we wish shopping for shoes or golf clubs could bring in extra money, we are talking about the grocery shopping service, Instacart. This relatively new service has gained a lot of popularity in 2020 as more people opt to do their grocery shopping online. Instacart allows people to pay a personal shopper – which would be you – to help them find the grocery items they need and deliver them to their home. If you are a champion at your local grocery store and are looking for the next challenge to test your skills, this could be your time to shine. Much of this income relies on tips, so if you want to try this out, be prepared to put your best foot forward.
4. Selling
When is the last time you had a yard sale? There are probably a few things around your home that you don’t really need anymore, and selling them could bring in a little extra cash. Shoes, clothes, baby items, books – these are all things that take up a lot of space in your house, even though you don’t use all of them. Get together with a neighbor or two and host a garage sale to not only add to your wallet, but also declutter your home. If you are not a fan of garage sales, take some pictures of the items you want to get rid of and use online selling options, like Facebook Marketplace or Craigslist.
5. Creating
If you have a creative outlet that can benefit someone else, make a plan to sell some of your products! You might be really handy with power tools, or maybe you are always getting comments on your custom-made t-shirts, or people can’t stop raving about your hand-knit scarves – your ability to create could also create an opportunity to bring in some money. Set up a free account for your new business on places like Facebook or Instagram, and let your community know that you are selling some high-quality, one-of-a-kind items.
This is the time to think outside the box – even if you never saw yourself taking a writing job or being a personal grocery shopper, 2020 has taught us to expect the unexpected, and to roll with the changes life brings us. Decide what direction you want to go, make a plan, and see where your new side-hustle takes you.